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Wise Alpha looks to tempt retail bond investors with Smart Interest

New platform allows retail investors to invest in corporate bonds and choose their return and duration

Launched in June 2016, WiseAlpha is the UK’s first platform
giving retail investors and savers access to corporate bonds issued in the
institutional debt market; in a little over a year the company has attracted
more than 2,500 registered members looking for guaranteed fixed income and has
offered over fifty investment opportunities.

The high yield bonds are issued as senior secured
debt and come from big corporates including Virgin Media, Pizza Express, the AA
and Debenhams, and could be attractive for investors starved of issuance on the
LSE’s ORB exchange.

WiseAlpha believes that its model puts it in the
vanguard of the fast moving fintech space (see www.muckle.online) and predicts that
peer-to-peer corporate lending will follow a similar growth trajectory to peer-to-peer
(P2P) lending, ‘giving investors choice and control over their wealth
accumulation.’

The company
has now announced the launch of Smart Interest ​ ​- a flexible retail bond
product that enables investors to customise their rate or investment term.

Investors can use Smart Interest to customise the
rate of interest (coupon payments) they receive between 3% and 8% per
annum, with investment terms ranging from 1-7 years.

As well as the flexibility to choose the duration of
their loan and the reward they receive, Smart Interest gives retail investors exposure
to a senior secured and high yield asset class that was previously only
accessible to the financial elite.

WiseAlpha determines an investment strategy and
decides which corporations to lend to, much as a mutual fund manager may invest
in a range of assets; however, unlike a mutual fund the investor receives
annual coupons with the full amount of investment returned at the end of the
chosen term.

The company said it believes this model is less
volatile, given investments are made in FTSE 350 size businesses with proven
track records.

At the launch of Smart Interest, CEO and founder of Wise
Alpha, Rezaah Ahmad, said: ‘Today’s launch of Smart Interest is one of our most
exciting product launches to date.’

‘When set against the backdrop of paltry bank
interest rates, Smart Interest enables all types of investor to gain exposure
to high quality corporate debt in a simple, predictable way. With inflation
standing at 2.9 per cent and fixed rate bank savings bond rates far below
inflation, the majority of savers are losing money in real terms. Smart
Interest has been designed with this in mind; to offer high quality
income-based investments, at a time when the retail investor community truly
needs them.’

‘We are confident that our members will enjoy the
customisable nature of our new product, while being able to access the
compelling yields within the institutional debt market. Until WiseAlpha
liberalised this multi-trillion market for the masses … we are firm believers
of a fairer investment world and technology is helping us achieve these goals.’